“The future of food is here, but unevenly distributed.” I heard this on an A16z podcast called “The Delivery-Optimized Future of Food” and thought it apropos since 30-40% of our nation’s food supply goes to waste each year. It’s a complex problem, one that costs our country $619 Billion. The good news; according to AgFunder’s 2020 FarmTech Investment Report, $4.7 billion was invested in 2019 by some of the biggest Venture Firms in the world (AgFunder, Andreessen Horowitz, Bessemer, Data Collective, Horizons, TPG, True Ventures, S2G, Sequoia, and 8VC). Quake Capital has invested 8% of our portfolio in agtech/foodtech to help begin to solve this issue.
I sat down with one of Quake’s founders, David Moosman, the CEO of ToMarket recently to discuss the industry and
David (aka Moose) was a chess champion in elementary school, played professional football for the Arizona Cardinals in the NFL and
was a trained chef. To say he strategizes ten moves ahead and tackles problems head on maybe a bit cheeky, but it is true. Here are some highlights from our discussion.
Q: How have the statistics surrounding food shortages changed in recent years, and what do they say today in terms of food waste?
A: There are two sides of this coin. There’s the large scale production that produces tons of food cheaply, and there’s small food production, which produces less food but in a more sustainable fashion. With large scale production comes a lot of players, whether they be producers, packagers, distributors and so on. These positions make up the so-called food chain. The food produced can be sent down to the small scale productions. Unfortunately, millions of pounds of food have been discarded due to spoilage before even reaching the chain itself. One side of the coin sees these unfortunate happenings, while the other side witnesses local food and CSA gaining support due to better sustainability, even if it’s not as streamlined. A lot has gone wrong, and it’s shown a lot of cracks in the food chain, but this has been good for the local supplier.
Q: Walk us through why you started ToMarket and the journey that got you to where you are now.
A: I was a heavy kid and I wanted it to be easier to eat better, but it was hard. People have been able to figure out a single solution for lots of different problems. Why is it so difficult to find and procure the services of someone grabbing healthy food for you? It really started there. Then I saw, as it scaled, the same problems as every step of the food chain had witnessed. They all have the exact same problem. And so, that is why we started ToMarket: to make it easier to find food, and specifically to make it easier for me to find better food.
Q: Something that I found so disheartening was the mental health of the local farmer. Can you talk about how this has gotten to be so terrible while simultaneously receiving little to no attention and support from the public? Is this something that can be solved?
A: Farming bankruptcies have gone up 20% year over year in the last two years. They’ve been steadily increasing for the last five to fifteen years. Farming is not an easy business. There’s so many things that go against you, and I think a lot of them come down to communication. First, it’s hard to report suicides on farms, because they’re so distanced from one another. Combine this with issues of lack of surveillance and potential alcoholism and you can see why depression, suicide rates and bankruptcies have been on a steady incline. I think these are part and parcel of making it easier for farmers to succeed, and to create a community around each other. I also believe they have a tradition of masculinity, of not wanting or needing help in the same way the older generations did not accept the help. Those old-fashioned methods were difficult and inefficient. They don’t make it easy on themselves in a lot of different ways. We’re here to give them a tool to make it easy in one very specific way: to find a home for their food before it goes bad.
Q: In terms of ToMarket, walk me through how a local farmer can tap into your platform and start working immediately. How are you working with farmers and purveyors today?
A: This is a relationship industry, and always has been. We’re working with our curators and boots on the ground who have these relationships to help build a bond throughout these rural communities, as well as through the restaurant industry. We specifically targeted B2B farms and restaurants because it’s more sustainable. There are more recurring orders, easier to get to and better to plan for. We’re making that even more efficient, and we’re starting off by making the relationships that they’ve already had better. Then, we find them new and better relationships, just as efficiently. We’re not here to change anything drastic or ruin a good thing. We’re here to make it easier with better communication and more efficiency while taking out the office hours, so they can have more people hours.
Q: What does the supply chain look like for a local farmer compared to a larger, corporate farmer?
A: With a bigger supply chain comes more waste. The more work you do, the more sales you need to do. It’s very difficult for anyone under a large industrial farmer to sell to these huge companies. Cisco has to make sure that they turn over inventory quickly, so they can throw away as little as possible. This means you, as a producer, have to be on top of your yields, production, delivery and the rest. That’s not always easy for small producers to do. We want to be able to offer companies, such as Sysco ,the ability to sell local products without having them go through their warehouse and inventory. Increasing efficiencies and allowing for better products without the loss for all sides of this market is the main goal here.
Q: ToMarket has tapped into local farms, from produce to meats and beyond. Walk me through that process and how you are building out that side of the fence into the market.
A: It doesn’t matter what you’re making; you have to find out who wants it before it goes out. We do this by going into these communities and helping the leaders. The chefs have spent years trying to build dozens of relationships, working through the problems of miscommunication and other issues. Now, we’re helping those leaders by giving them the tools to do everything better, faster, and more efficiently, eventually scaling that back to the community. We do this so people who haven’t established themselves as businesses can establish it the most efficient way. We’re starting with the leaders, building a community there, and then affecting the surrounding area, whether it’s with produce, meats, or other commodities.
Q: You’re an example of a leader who went to culinary school with a strong background. You clearly have a passion for the work that you do. How has being a chef allowed you to really understand and tap into these high end restaurants and leaders in their community as it pertains to food.
A: I have worked on oyster farms, vineyards, produce farms, ranches, butcher shops, as well as restaurants. I’ve actually lived the life of trying to find these farmers and connect with them, with lists on how to get what each farmer has and when to talk to them. My time as a chef led me to this and it was because of my problem: finding better food easier. Eventually we saw the root of that was actually helping the purveyors with the tools to do it better and easier. In doing so, we can create the network and the market community around that.
Q: With the global pandemic, what has been the feedback on how they’re getting through this time? What are the plans for the future, and how are they aligning? How is that aligning with your platform ToMarket?
A: They’re figuring it out. This is a day by day thing, changing every day. Thankfully, it’s trending for the better. They’re generally looking at it, diversifying who they sell to, how they sell, and what they sell. These restaurants are looking to sell more than just meals. They want to sell a bread or produce basket and do take out as well. ToMarket helps by creating micro markets, the ability to have a farmer’s market anywhere and anytime virtually, without the hassle or crowds or weather concerns. It allows the same community along with the same products that allows the same ordering more often more places. What we want to do is give them the tools to diversify what they sell, who they sell to, and how they sell.
Q: Are there any particular areas you hope to work on with ToMarket that we have not discussed yet? Additionally, are there any specific people you hope to communicate and connect with that are outspoken in the industry?
A: Inequality and inequity has been a part of agriculture from the beginning of this country, and we want to supply the tools necessary to equalize the playing field, regardless of background or skin color. We’re also helping what’s called the BIPOC community in Portland, as well as farmers of various backgrounds in all of our markets. The idea of equality is a foundation and not a response. In terms of who we wish to speak with, there’s a growing population of Agriculture Tech investors looking for robots and fields. We’re looking to be just as much of a tool for farmers as their watering or harvesting tools. There’s a very small contingent of restaurant investors and we think there’s a huge place for them to invest in the health of their restaurant.
This problem has sparked a Food Revolution, which according to S2G Ventures has already begun. “As the food industry shifts from analog to digital, data science teams are becoming the new farmers and chefs of our global food system. By harnessing the power of data and emerging technologies like AI, agtech startups will meet the needs of today’s consumers like never before – bringing them healthier, more diverse and flavorful food at a lower cost.” (S*anjeev Krishnan, managing director of S2G Ventures)*
